Intro Business Test 1
The West Asian country of Quinland is experiencing an economic downturn. There has been a decrease in its gross domestic product for two consecutive quarters. In this scenario, Quinland is most likely facing an _____.
economic recession
A(n) _____ is a structure for allocating limited resources.
economic system
Torino Mex, a men's fashion boutique, is renowned for creating designer clothes for Latino Americans.However, it introduced a new line of designer clothing that especially caters to young Hispanic Americans to widen its customer base. Which of the following dimensions of the social environment is highlighted in this scenario?
Diversity
Chargon Flasks, a restaurant specializing in Asian cuisine, focuses solely on customer satisfaction. It allows patrons to customize the quantity of their meals and only charges them half the price if their meal is unsatisfactory. The restaurant also has a voluntary service charge policy. In this context, which dimension of the business environment is affected the most?
The competitive environment
In the context of the strategies for reaching global markets, which of the following statements is true of direct investment?
The cost involved in direct investment is high.
In the context of today's business environment, which of the following statements is true of millennials?
They can be trained and developed to fill the leadership gap that is being created by the retirement of baby boomers.
Ethics refer to:
sets of beliefs about right and wrong.
Boson Corp., an American software development company, wants to expand its business in international markets. Therefore, it buys property in Greitch, a South Asian country, and sets up a production facility despite the high costs involved. In this scenario, Boson Corp. is most likely involved in _____.
direct investment
In _____, firms either acquire foreign firms or develop new facilities from the ground up in foreign countries.
direct investment
Brestine Inc., a European multinational corporation, wants to expand its customer base and decides to target theAsian market. As most Asian countries have comparatively low per capita income, the company introduces cheaper versions of its products that would appeal to the target market. In this scenario, Brestine Inc. is most likely facing the barrier of _____.
economic differences
Prior to formulating its annual budget, the government of the Asian country of Florenesia employs a number of individuals to look into the overall productivity of the country. These individuals are also responsible for studying and revising some of the taxation policies and gauging the employment rate. Given this information, these individuals are studying _____.
macroeconomics
In the context of the workforce advantage in the business environment, finding and holding the best talent will likely become a crucial competitive issue in the next decade as the baby boom generation begins to retire.However, job market contraction may not be an issue, because:
many baby boomers opt to postpone retirement in the face of inadequate financial resources.
Mercy's Apparels, a fabric company, was established post World War II with the aim of catering to the demands of consumers looking for affordable quality clothing. To differentiate itself from its competitors, the company developed a distinctive identity as the producer of budget clothing. In the context of the history ofAmerican business, Mercy's Apparels was most likely established during the _____.
marketing era
Rudolf, a Polish manager in a company based in China, is admired by his colleagues for the way he interacts with people, his considerate nature, and his tolerance toward other cultures. In the context of universal ethical standards, Rudolf possesses the core value of _____.
respect
In the year 2002, Timothy wanted to purchase a house. As he did not have sufficient funds, he decided to take a loan. Given his low credit score, it was highly unlikely that he would be able to repay the borrowed money.However, he was able to secure a loan despite his reduced ability to repay the loan. Timothy most likely applied for a _____.
subprime mortgage loan
The government of Keiron, a South Asian country, noticed a visible decline in the country's natural resources.To counter this, it passed an act that mandated all businesses to reduce wastage and adopt more eco-friendly methods of production. In the given scenario, the government of Keiron most likely embraced the idea of_____.
sustainable development
In the context of the technological environment of business, which of the following statements is true of online technology?
Alternative selling strategies give rise to a more individualized buying experience.
Which of the following is a similarity between socialism and communism?
Both have a strong involvement of the government.
In the context of the barriers to international trade, which of the following is the best way to jump over sociocultural barriers?
Conducting thorough customer research
_____ range from simple barter to a complex web of exchanges that end up meeting the needs of multiple parties.
Individual countertrade agreements
Which of the following statements is true of the World Trade Organization (WTO)?
Ministers of the WTO meet every two years to address current world trade issues.
_____ is a market structure with just a single producer completely dominating the industry.
Monopoly
Which of the following is an example of a natural monopoly?
Public utilities
The most socially responsible companies establish _____ for their vendors, setting clear policies for human rights, wages, safety, and environmental impact.
codes of conduct
A capitalist system depends on fair competition among businesses to:
drive higher quality and lower prices.
When a business brings in less money than it needs to cover expenses, it incurs a _____.
loss
In the context of key economic considerations when entering a foreign market, the transportation infrastructure in a country most likely includes _____.
roads
Which of the following countries has a trade deficit?
A European country that has a higher total value of imports than exports
Consider an exchange rate situation in which 1 Indian rupee equals 0.40 Japanese yen. Given this information, which of the following statements is true?
A Japanese tourist can buy more goods and services in India.
Which of the following statements is true of productivity?
A high level of productivity typically correlates with healthy gross domestic product growth.
In the context of the economic environment of business, which of the following is most likely to reduce the risks of running a business?
A low level of corruption
Touca Ness, a fantasy movie franchise, was initially created for children in the early 1960s. However, as the franchise started to gain a cult following, the content of the franchise began to include mature themes to maintain popularity among its existing consumers. Identify the dimension of the social environment that this scenario exemplifies.
Aging population
In the context of social responsibility, _____ are a new corporate structure that value profits, but not more than other priorities such as employees, suppliers, the community, and the environment.
B-Corps
In the context of the business cycle, which of the following statements is true of the period of economic contraction?
Consumers shift their buying patterns to more basic products.
Which of the following can be considered a business?
Davent, an online shopping portal that offers discounted prices on clothes
In the context of ethics and social responsibility, which of the following has become a core issue in the marketplace?
Doing business today without harming the ability of future generations to meet their needs
Which of the following strategies for reaching global markets allows firms to expand into foreign markets with little or no investment?
Foreign licensing
_____ is the authority granted by a domestic firm to an overseas firm for the rights to produce and market its product or to use its trademark/patent rights in a defined geographical area.
Foreign licensing
In the context of factors of production, which of the following is most likely to result in a decrease in entrepreneurial activities?
High taxation
One core responsibility of business is to deliver consumer value by providing quality products at fair prices._____ are critical components of this equation.
Honesty and communication
_____ means buying products domestically that have been produced or grown in foreign nations.
Importing
In the context of the history of American business, which of the following statements is true of the entrepreneurship era?
Industrial titans exploited workers and decimated the environment.
Negacho, a food and beverage company, introduced a new flavor of potato chips called South Indian Chillis. It received a positive response from consumers, which prompted Brex Mex, another food company, to introduceits own Szechuan flavored chips. In this scenario, which of the following is most likely to have influenced BrexMex to produce a product similar to Negacho's?
Inflow of innovation
In the context of the strategies for reaching global markets, which of the following is a key risk of foreign outsourcing?
Involvement of social responsibility
In the context of mixed economies, which of the following statements is true of the U.S. federal government?
It is part owner in a number of financial institutions.
Which of the following statements best defines the producer price index (PPI)?
It measures the change over time in the prices that businesses pay each other for goods and services.
Which of the following statements best describes the role of the government in a capitalist economy?
It monitors the competition to ensure compliance to regulations.
Which of the following statements is true of the technological environment of business?
It represents a rich source of competitive advantage for fast-moving firms.
Who among the following is most likely to benefit in a case where there is a weak dollar against a euro?
John is an American who exports goods to Europe.
Alice, the global marketing director of a multinational electronic goods manufacturing firm, is assigned the task of expanding her firm in new markets. She learns that hiring labor is expensive and that the required technical manufacturing equipment is unavailable in the international market. In this scenario, which of the following is most likely affecting the global trade of Alice's firm?
Limited access to factors of production
_____ are market structures with one company as the supplier of a product because the nature of that product makes a single supplier more efficient than multiple, competing ones.
Natural monopolies
_____ is a market structure with only a handful of competitors selling products that can be similar or different and has high barriers to entry.
Oligopoly
Which of the following is a function of the International Monetary Fund (IMF)?
Promoting global trade
In the context of factors of production, which of the following is an entrepreneurial "must"?
Protection from corruption
In the context of the free market system, which of the following market structures has a low barrier to entry?
Pure competitions
Who among the following is most likely to benefit when the dollar is strong and the euro is weak?
Ron is an American who is touring Europe.
Antonsen Inc., an accounting firm in Texas, follows certain guidelines while providing consulting services to a firm. One such guideline is to limit the services it provides to the firms it audits. The CEO of Antonsen Inc. is also required to certify the validity of the company's financial statements. In this scenario, Antonsen Inc. most likely abides by the requirements of the _____.
Sarbanes-Oxley Act
The _____ limits conflict-of-interest issues by restricting the consulting services that accounting firms can provide for the companies they audit.
Sarbanes-Oxley Act
In the context of the competitive environment of business, which of the following can be a key source of competitive advantage?
Speed-to-market
Which of the following statements is true about socialist economy?
Tax revenues fund services that citizens in free enterprise systems would have to pay for themselves.
Renault and Renoir, a law firm, is infamous for influencing witnesses with the use of bribes. Because of this corruption, the law firm has won many cases that it would have otherwise lost. In this context, which dimension of the business environment is affected the most?
The economic environment
Buba Joe's Pizzeria, a fast food chain, wants to expand its customer base. It introduced a new range of vegan pizzas to cater specifically to the vegan market. It also introduced new flavors to cater especially to HispanicAmericans. In this context, which dimension of the business environment is affected the most?
The social environment
Which of the following dimensions of the business environment covers the measurable characteristics of a population?
The social environment
In the context of factors of production, which of the following statements is true of entrepreneurs?
They thrive in an environment that supports economic freedom.
Which of the following statements is true of codes of conduct?
They work best with monitoring.
Which of the following is a difference between corporate philanthropy and corporate responsibility?
Unlike corporate philanthropy, corporate responsibility focuses on the actions of the business itself rather than donations.
In the context of the dimensions of the business environment, which of the following is true of the competitive environment?
Vocal promoters of a firm's products can get the firm new customers effectively.
In the context of ethics and social responsibility in the global arena, which of the following statements is true of a business's responsibility to workers abroad?
When deciding living wages, companies must bring together their own values with the laws of both theUnited States and their host countries.
Ithilium, a European country, is able to produce more electronics than Kilim, a North American country, event hough both countries use the same amount of resources. Given this information, it can be deduced that Ithiliumhas a(n):
absolute advantage over Kilim.
A _____ refers to the overage that occurs when more money flows into a nation than out of that nation.
balance of payments surplus
When the Fed sells securities, _____.
banks cut back on the loans
The Fed directly stimulates spending by:
buying government securities.
Rochester, an Asian country, follows an economic system that facilitates private ownership. The country's economy is based on economic freedom and fair competition. Given this information, the economic system followed by Rochester is _____.
capitalism
Finwes is an advertising company. Because of certain untoward incidents in the company, the management decides to create a formal written document that would guide the employees in making right decisions in various professional situations. In this scenario, the management wants to create a _____.
code of ethics
Openi, an island nation, is able to increase its textile production without having to compromise on the production of other materials. This is in contrast to other nations that need to lower the production of other materials to increase their textile production. In this scenario, Openi has a _____ in textile production.
comparative advantage
In the context of globalization, one of the most challenging issues faced by companies and individuals that are involved in international business is _____.
corruption
Nipennie and Mirasa, two developing countries, bartered cotton for jute rather than for currency. In this scenario, the two countries engaged in _____.
countertrade
In the context of key economic considerations when entering a foreign market, the financial infrastructure in a country most likely includes _____.
credit
In the context of open market operations, when inflation is a concern, the Fed sells securities to buyers who write checks to the Fed to pay for securities they bought, and the Fed withdraws these funds from banks. With fewer funds, _____.
credit becomes tighter
High taxation, excess regulation, and limited choices in a business environment are likely to result in a(n)
decrease in entrepreneurial activities.
Neminski, an Arab country, is renowned for its rich oil reserves. It earns approximately $1.3 billion annually by selling crude oil to other countries. Given this information, Neminski is most likely involved in _____.
exporting
Anaida is an entrepreneur who believes in providing equal opportunity to people regardless of their age, gender, race, or religion. She is open-minded and detests the idea of taking advantage of others. In the context of universal ethical standards, Anaida most likely possesses the core value of _____.
fairness
Pyoiunalek's, a restaurant chain, markets and endorses its businesses in other countries by offering buyers the rights to launch and operate the restaurant in that country. It lends financial and marketing assistance to the buyers. In this scenario, Pyoiunalek's is employing the strategy of _____ to reach global markets.
foreign franchising
Rubicon Inc., an American guitar manufacturing company, signed a contract with a supplier in Umreia, an Asian country, to manufacture guitars. Rubicon then imported these products and sold them in its markets under its own brand name. Rubicon did this because of the availability of cheap labor in Umreia that substantially cutdown Rubicon's cost of production. In this scenario, Rubicon is most likely involved in _____.
foreign outsourcing
In the context of the economic differences among nations in international trade, effectively serving less-developed markets requires:
innovation.
Denver wants to start an industrial products manufacturing company, but he finds it difficult to enter the market as it is already dominated by a single producer who controls product quality and product prices. Given this information, Denver is unable to enter the market because of the existence of _____.
monopoly
In the context of global trade, a balance of payments deficit means that:
more money flows out than in.
Despite the U.S. economic crisis of 2008, research suggests that:
most budding entrepreneurs still plan to launch their firms in the next three years.
Tornio, a steel company, imports iron ore from Marquette iron range in Michigan. In this scenario, the iron ore obtained by Tornio can be classified as _____.
natural resources
A small-scale consulting firm in Hawaii was struggling financially because it was unable to generate enough capital to run its business transactions. To generate capital, the firm decided to use web technologies and digital resources to build long-term associations with current customers and to reach out to new customers. In this scenario, the firm is using concepts that primarily originated in the _____ of American business history.
relationship era
With an increasing number of workers facing challenges such as raising kids and caring for elderly parents, responsible companies are stepping in with programs such as on-site day care, company-sponsored day camp, and referral services for elder care. These actions show that these companies are fulfilling their _____.
social responsibility
Companies that step in with on-site day care programs for employees facing challenges such as caring for elderly parents are fulfilling their:
social responsibility.
In the context of the competitive environment of business, the rate at which a new product moves from conception to commercialization is referred to as _____.
speed-to-market
Anderson invested $1 million in a company called Ladmen Corp. He, therefore, has a personal interest in the company's profits and its new ventures. Given this information, Anderson is a _____ in Ladmen Corp.
stakeholder
In the context of social responsibility, _____ include employees and investors who have a personal interest in the performance and actions of an organization.
stakeholders
In the context of the core values identified by the Character Counts organization, being honest, not deceiving, cheating, or stealing, and doing what you say you'll do represent the universal ethical standard of _____.a. trustworthiness
trustworthiness
Mavin is the regional manager of Crustie Mex, a packaged food company. He is respected by his peers and subordinates for his immense knowledge and skills. Mavin decides to quit the company for a higher position at another firm. The CEO of Crustie Mex entices him with a competitive compensation package and promotion because he knows that Mavin is an important resource. The given scenario most likely exemplifies the concept of _____.
workforce advantage
Russia and China are both rich in natural resources and human resources, and both countries have a solid level of capital. Yet, neither country is wealthy. The missing ingredient seems to be _____.
entrepreneurship
Lewis Gretsz, the owner of a small railroad company in the 1860s, started gaining more influence and money as his business started to flourish to a point where he began controlling the entire northern half of railroad services.He followed a ruthless and cunning business strategy that involved exploiting workers and decimating the environment. In the context of the history of American business, Lewis Gretsz most likely belonged to the_____.
entrepreneurship era
Cappa Street is a company that produces gourmet coffee. The company's employees, the coffee bean growers who supply raw materials to the company, the people who purchase its coffee, and the people who live in the community where the company has its production unit are Cappa Street's:
stakeholders.
